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11/7/2005
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Cablevision Boosts Broadband Speeds

The cable company plans to offer service with speeds of up to 50 Mbps. A slower service--downloads of 30 Mbps and uploads of 2 Mbps--is priced at $64.95 a month.

There's a speed war under way when it comes to Internet access, and the cable TV companies and phone companies keep upping the ante.

Cablevision Systems Corp. on Monday said it would boost speeds of its broadband Internet access service to up to 50 Mbps, five times faster than what it offers today and besting the top tier of Verizon's competing Fios service by 20 Mbps. Cablevision, the fifth-largest cable company in the country, serves large parts of the New York City metropolitan area.

The service comes relatively cheap, too. Although Cablevision hasn't disclosed pricing for the 50-Mbps service, it has for a slower service that offers download speeds of 30 Mbps and uploads speeds of 2 Mbps. That's still about 20 times the speed of a standard T1 line (1.5 Mbps), but is offered at a fraction of the cost: $64.95 a month for a current Internet-only subscriber. By comparison, Verizon's Fios costs $199.95 for 30-Mbps service. And it's cheaper than Comcast's $67.95 6-Mbps offering.

The aggressive pricing and high-speed offerings come at a point when cable TV and telephone companies are jockeying for an upper hand in the new playing fields of triple- and quadruple-play offerings that bundle voice, data, video, and wireless. "We're entering a new era, one that is changing what it means to become a communications carrier," SBC CEO Ed Whitacre told conference-goers in Las Vegas two weeks ago. "Our goal is becoming the only communications carrier you need."

Credit Suisse First Boston Corp. analysts reported last week that the cable companies' market share of broadband Internet users has shrunk 3% from just a year ago and is expected to shrink even further by 2010, while phone companies appear to be on the rise. Cable holds a 58% share of the broadband market this year, according to the Credit Suisse report. Both SBC Communications and Verizon have consumer DSL offerings priced as low as $15 a month.

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